I was thinking of ways to increase long term participation in the protocol especially for when the incentives and points for air drops eventually end, to add some more sticky tvl and participation. Plus let’s test the new board right? So what if a small portion of the burn pile maybe 5 to 10% per burn what if we redistributed that portion to anyone with a lock of 2 years or more pro rata? This should encourage some longer locks and give those extra incentive to stay locked even through volatile periods. Anyways, thanks for listening to my idea.
Interesting and as a lock holder, I’m always open for more DUST coming my way. lol. I assume it’s like an airdrop for long term veDUST lock holders right? I dunno, but since we can’t recover the burned token, it has to come from the treasury?
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I know that part of the burned tokens sit for a while and get burned in batches. I didn’t know if it’s automatic or if the devs have control before it goes to the burn wallet.
I was just thinking it could be called the “Loyalty Dividend” 5 to 10 % of the burn pile is negligible and wouldn’t really affect the burn rate in any major way. It discourages mercenary farming by aligning incentives with the protocols most loyal participants.
We would have to find out if that’s even possible though if any devs happen to pass by 
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The process is not automatic, it is manually triggered.
But this is an interesting idea, however, we have to balance the protocol’s interest with the user’s personal interest. From the user’s POV, great, you get extra tokens for simply locking longer. From the protocol’s POV, we’re giving up the deflation mechanic which affects everyone to benefit only a select group of users. It creates a skewed level of benefit based on lock period, which we already have from the vote-escrow design. In fact, this further exaggerates the skew.
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Once a token is burned, isn’t it permanently removed the blockchain? I understand what you mean though, it would require a change in some governance rules, etc. Your comment immediately brought up the question for me. You mentioned once protocol incentives are over. Well, That’s a good question. As far as I am aware, for the first year at least. Monad is incentivizing protocols with MON, so that they can have reward systems, airdrops, etc to incentivize early protocol liquidity. It makes me wonder if after your year one, once those protocol rewards end if that will affect neverland’s ability offer high apys, Dust incentives, etc
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Yes once it’s burned out is but I believe they do the burns in batches. Which would give the opportunity to do so before the tokens are sent to the burn address. I’m also thinking about when the points campaigns end for magma, kintsu, and fastlane. I’m sure there will be a decline as some funds are removed after they end but if we can encourage those to stay longer than a year it should help. Plus then any one who panic sells at that point has to force an early unlock adding more to the burn pile.
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Neverland actually has one of the lowest MON incentives from the Monad Foundation AFAIK. I believe what they’re referring to isn’t MON incentives but DUST incentives, which will end eventually.
However, that’s not to say that we wouldn’t change things up via governance before that happens.
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As far as the deflation mechanic goes 5 to 10 percent of that pile wouldn’t significantly impact the burn rate at all. We could discuss what a better time frame might be maybe over a year locked? Your right about it causing weighting issues towards those with more power and a longer lock but anyone can do it, everyone has the option to lock longer, maybe we could even do it evenly as opposed to pro rata and just do a fair distribution system for all locked longer than a year or two? So as not to weight it towards those who hold more.
Yea the dust incentives too thank you sir
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Yeah though 5-10% of our burnt tokens represent quite little compared to the amount locked so without doing the math, it feels inconsequential to me that it’ll make meaningful impact.
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Yeah right now but if the burn rate increases as usage of the protocol goes up it should increase as well but yea it wasn’t meant to be a significant source of dust accumulation just more of a nice surprise I feel you though.
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Sharing an idea from Tranquil Finance. (they closed shop after the Harmony bridge hack, also implemented their own version of Compound lending.) Effective in keeping user participation beyond airdrops.
What they did was to distribute rewards as a mixed pot of stables and tokens/coins of varying market weights. So they have like protocol rewards pot of $BTC, $ETH, $USDT, $ONE, etc… and their own protocol token $TRANQ. This really incentivizes long term participation away from reliance on airdrops. Chances are the apps. own protocol token and hosting blockchain token may be trending down as seen on other projects, but having BTC and ETH keeps value relatively up over all. Makes user engagement more interesting. This keeps users engaged to look forward to something more valuable rewards in the future (after locking time).
So if $veDUST rewards = $1, why not equivalent of $BTC = $1 and others…
In the previous lending app that the team had managed before starting Neverland, we distributed rewards in the form of a basket of tokens and feedback from users was that they don’t like it (because they don’t use many of the assets in the basket), and it was not gas optimised.
So when we designed Neverland, it was decided that rewards will be in stables so that users have the optionality to swap into whichever asset they want.
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I think we have an opportunity with Monad as this is a very gas friendly blockchain.
And limited mixture of “highvalue” tokens inclined to be recognized as store-of-value, and stables. The new lending projects protocol primary tokens seems only have 2 outcomes over time - 1) peg to a range of value with some effort, or 2) decline in value, with many on the latter.
So in a sense this has to be made as an economic case, and selling to customers wearing a financial analyst hat. After all a lot has changed tokens now as we have RWA, stocks, and others, of course still tilting to maybe on $BTC or similar that has a reasonable and dependable store of value properties.
But we should not stop there, there is an opportunity to have malleability and flexibility built-in in determining appreciating and reliable store of values.
Has it been airdropped yet？
We don’t do airdrops.
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I support the idea. Overall I am not convinced that buying back and burning tokens is necessarily the best allocation of resources.
If I am interpreting the data correctly, around 604k tokens have been burned so far which is roughly 0.6% of total supply, with approximately $200k spent in the process at a rough estimate (please correct me if I’m wrong).
What if part of the tokens bought back from the market were redirected toward veDUST lockers who commit to 2+ year locks? Another portion could be used for incentives, for example encouraging the supply of specific assets or rewarding borrowers.
Burning may be good marketing, but at this stage it might be more effective to incentivize user behaviors that directly benefit the platform such as borrowing, lending, LP activity, long-term locking, governance participation and so on.
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So you’re suggesting basically instead of a burn the buybacks would redirect to a Treasury to be used for whatever the protocol deems fit basically? That’s actually what HYPE does I believe. It’s an interesting idea I like it if we have a good plan for the direction of the tokens.
Burns do not happen only via token buybacks. Majority of burns actually happen via user actions: when they choose to claim their rewards as DUST or when they early unlock.
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Yeah, something along those lines. At an early stage, there are probably more productive uses for tokens than simply burning them.
And as Hypermassiv rightly pointed out, burns could work for tokens associated with early unstaking.
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What are some examples of productive uses instead of burning?
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